Required information [The following information applies to the questions displayed below.] The following is the adjusted trial balance of Sierra Company. Sierra Company Adjusted Trial Balance December 31 Account Title Cash Prepaid insurance Notes receivable (due in 5 years) Buildings Accumulated depreciation-Buildings Accounts payable Notes payable (due in 3 years) Common stock Retained earnings Dividends Consulting revenue Wages expense Depreciation expense-Buildings Insurance expense Totals Debit Credit $ 17,000 1,100 5,200 50,000 $ 18,000 5,500 6,000 12,000 7,500 4,000 39,500 4,100 5,000 2,100 $ 88,500 $ 88,500 (1) Prepare an income statement for the year ended December 31. (2) Prepare a statement of retained earnings for the year ended December 31. The Retained earnings account balance was $7,500 on December 31 of the prior year.